CHICAGO (CN) - United Airlines didn't breach its contract with its frequent fliers when it unilaterally changed the value of miles awarded as part of the airline's loyalty program, the Seventh Circuit ruled.
Following United Airlines' merger with Continental Airlines in 2010, it made a number of changes to its frequent-flier program called MileagePlus, court records show.
Members who travel frequently may qualify for premier status. Premier benefits last for the remainder of the calendar year and for the following calendar year.
But the restructuring of United's frequent-flier program stratified customers into four levels instead of three, and some customers lost benefits they were previously entitled to when they were dropped to a lower level.
In 2014, United also moved to tie the accrual of miles to ticket prices.
A class of frequent fliers led by Holli Hammarquist challenged their loss of benefits in federal court.
But a federal judge ruled against them, and the Seventh Circuit affirmed Thursday.
"The undisputed evidence confirms that United was authorized to change the program benefits at any time, or at least from year to year," Judge Daniel Manion said, writing for a three-judge panel.
The first general condition of the 2011 program rules authorizes United to modify the MileagePlus program as its discretion, with or without notice, even though the changes might affect the value of miles already accumulated.
"None of the evidence relied upon by the plaintiffs suggests that United ever 'stated' that General Condition No. 1. did not apply to the Premier Program. More importantly, in describing the potential for future modifications, the webpages simply declared that premier benefits could change 'from year to year' - not that they could change only from year to year," Manion wrote. (Emphasis in original.)
And the general condition clearly states that a modification of the program might deprive some members of benefits, the Chicago-based appeals court ruled.
"At bottom, the plaintiffs' argument on appeal is that United breached a contractual promise to provide them with premier benefits in 2012 that matched the premier benefits previously available in 2011," Manion wrote. "The undisputed evidence shows that United never made that promise, and United cannot be liable for breaching a contract that it did not make."
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